FamilyBoost Tax Credit

FamilyBoost tax credit is available from Inland Revenue to help eligible parents or caregivers pay for the cost of early childhood education from licensed providers.

Eligible parents or caregivers can claim up to 40 per cent of their remaining childcare costs, after 20 hours ECE and the deduction of assistance for childcare costs from MSD for licenced early childhood education.

Examples of assistance for parents and caregivers with childcare costs from MSD for licenced early childhood education are:

• Childcare Subsidy
• Early Learning Payment
• Guaranteed Childcare Assistance Payment
• Training Incentive Allowance

Parents or caregivers can submit invoices for the previous three months of remaining ECE costs to Inland Revenue.

Inland Revenue will pay a lump sum of up to $120 per week per eligible household for the FamilyBoost Tax Credit for the three-month period.

Any FamilyBoost Tax Credit made to an individual by Inland Revenue is not chargeable income or a cash asset for 12 months from the date that parent or caregiver gets each payment for the following types of assistance:

• main benefits
• New Zealand Superannuation and Veteran's Pension
• Accommodation Supplement
• Advance Payment of Benefit
• Childcare Assistance
• Community Costs
• Disability Allowance
• Employment and Work Readiness Assistance
• Flexible Funding Assistance
• Funeral Grant
• Home Help
• Housing Support Products
• Income Related Rent
• New Employment Transition Grant
• Recoverable Assistance Payment
• Residential Care Subsidy and Loan
• Seasonal Work Assistance
• Social Rehabilitation Assistance
• Special Benefit
• Special Needs Grant
• Student Allowance Transfer Grant
• Student Allowance
• Temporary Additional Support

When a client applies for hardship assistance, their income and assets need to be assessed for eligibility.

If a client got a FamilyBoost payment within the last 12 months of this application, that payment is exempt from being considered income or a cash asset for qualification purposes.

However, clients must use their own resources before seeking hardship assistance. If the client has enough money to meet their need using a FamilyBoost payment, they generally won't qualify for a payment.

If the client only has enough money available to meet part of the cost, hardship assistance can be considered for the remaining amount.

In each case MSD must consider the individual circumstances of the client against the eligibility criteria.

Example

George visited the dentist for a sore tooth and required three fillings. The cost of the dentist visit, including the fillings, was $212.50.

This was an unforeseen cost and as a result George has applied for a Special Needs Grant for food because he cannot cover the cost of his groceries this week. George and his family's weekly groceries usually cost $200.

George has received a FamilyBoost Tax Credit payment of $350 for the past 3 months of childcare costs and used part of it to pay for his dental treatment.

After paying the dentist George has $137.50 left. This is not considered to be a cash asset for hardship assistance; however, it is still considered a resource available, and George can partially meet his own need for food.

George is granted $62.50, the difference between his available resources ($137.50) and the usual cost of his weekly groceries ($200).